Globalization and China Economic Policies Towards Africa

Emerging China-Eritrea Bilateral Relations

Dr. Suresh Kumar

Eritrea profile, Vol.14, No.28, 13 June 2007

Part-I

The author interviewed on “Beijing Summit of the Forum on China-Africa Cooperation, 3-5 November 2006,” with BBC World Service under BBC Asia Program on 4 November 2006. This article is the extension of his interview.

Introduction

The Changing International political and economic condition persuades Africa adopting peace, development and enhancing cooperation to carry forward the people’s enhancement in socio-economic field. Africa needs friendly countries around the world that follows the path of peaceful development and respects mutual interests. “China’s African Policy (CAP) mentions its government wishes to present to world the objectives of China’s policy toward Africa and the measures to achieve them, as well as its proposals for cooperation in various fields in the coming years, with a view to promoting the steady growth of China-Africa relations in the long term and bringing the mutually-beneficial cooperation to a new stage” (China African Policy, January 2006: 1). The year of 2006 marks the 50th anniversary of the launch of China-Africa diplomatic relations and a new stage in the development of bilateral ties with as series of political and cultural events running through the year. The New Partnership for Africa’s Development (NEPAD) came forward with new plans and ventures for economic development. NEPAD and South-South Cooperation will surmount difficulties and mark growth in the changing international politics. China-Africa (including Eritrea) right from the days of liberation struggle exchanged political, economic and moral support. According to China’s Ministry of Education, it has established educational exchanges and cooperative relations with more than 50 African countries. In the Action Plan for the Sino-Africa cooperation in the next three years announced at the Summit, China pledged to increase the number of Chinese government scholarships to African students from the current 2,000 per year to 4,000 per year by 2009.

China sent message of congratulations to President Isaias Afwerki on the 16th Independence Day anniversary. ‘President Hu Jintao expressed admiration to Eritrea’s development achievements over the years and noted that Eritrean-Chinese cooperation in different domains has been successful. The PRC leader stated that since the establishment of diplomatic relations, Eritrea-Chinese has undergone favorable development with fruitful cooperation in diverse fields. He further asserted that he would work together with the Eritrean government on constantly pushing ahead with the friendly cooperation of the two countries’ (Eritrea Profile, Vol.14, No.22, 23 May 2007).

Today, “Sincerity, equality and mutual benefit, solidarity and common development- these are the principles guiding China-Africa exchanges and cooperation and the driving force to lasting China-Africa relations” (CAP: 2). Along with it, the Beijing Declaration of the Forum on China-Africa Cooperation, the Program for China-Africa cooperation in Economic and Social Development and the forum on China-Africa Cooperation, Addis Ababa Action Plan (2004-06) are its follow up action plans. Moreover, CAP and NEPAD will enhance mutual political trust and pragmatic cooperation.

Globalization and its Challenges towards China

Today, the socialist construction and the path of tactical line in China need to be evaluated. The Das Kapital of Karl Marx explained that the development of capitalism leads to the concentration and centralization of capital in few hands. The law of capitalism mentioned that the huge amount of capital gets accumulated. As a result, this needs to be deployed to turn profits, which is the raison d’etre (foundation) of the capitalist system. This capitalist economic system today is known as Globalization.

Multinational Corporations (MNCs) huge accumulation of finance capital (over $400 trillion) outstrip the combined GDPs of many developing countries requires the removal of all restriction (trade business) on the movement of this industrial capital in search of super profits. International Monetary Fund (IMF), the World Bank and World Trade Organization (WTO) are convincing the developing world to remove all trade barriers that seeking the economic re-colonization of developing countries.

1. The globalization is accompanied by the utilization of vastly growing scientific and technological advances not for the benefit of the vast masses of humanity but for strengthening the rapacious plunder for greater profits. This is the phenomenon of JOBLESS GROWTH.

2. This phase of globalization is accompanied by sharp widening of inequalities in developed & developing countries and rich and poor masses in the entire world.

3. The large-scale impoverishment of majority people in the world clearly shows the shrinkage of their capacity to be consumers of the products that this globalizes economy produces. This renders the entire process of globalization to be simply unsustainable.

Marx mentioned in Das Kapital, “With adequate profit, capital is very bold. A certain 10 percent will ensure its employment anywhere; 20 percent certain will produce eagerness; 50 percent positive audacity; 100 percent will make it ready to trample on all human laws; and 300 percent there is not a crime at which it will scruple, nor a risk it will not run, even to the chance of its owner being hanged”.

The China Experience of Socialism and Challenge to Globalization

The eradication of poverty and illiteracy, the elimination of unemployment, social security in the fields of education, health, housing, etc. provided a powerful impetus to the working class people all over the world, is the achievement of socialist countries. The present situation where the international correlation favors imperialism with its virtual monopoly over capital and technology, the socialist countries engaged in serious efforts at developing productive forces to consolidate socialism. While these reforms have led to rapid economic growth in some countries like China, new problems have also arisen.

It is the need to critically examine the theoretical and political issues with special reference to China. The semi-feudal and semi-colonial China did not and could never have meant the automatic transformation of the backward economies and low levels of productive forces into high levels (higher than that of capitalism) of socialized means of production. Every socialist revolution (including China and Eritrea) based on a concrete analysis of concrete conditions and worked out its approach towards developing rapidly the productive forces. How this can be done is specific to the concrete realities faced by the specific revolutions, both domestically and internationally.

The political enthusiasm is very high after revolution and the people (Chinese or Eritrean) expected to accomplish economic tasks just like political task they had accomplished by relying directly on this enthusiasm. Lenin, himself, noted on the 4th anniversary of the October Revolution: “Not directly relying on enthusiasm, but aided by the enthusiasm engendered by the great revolution, and on the basis of personal interest, personal incentive and business principles, we must first set to work in this small peasant country to build solid gangways to socialism by way of state capitalism” (Lenin, Collected Works, Vol.33, p.58 emphasis added).

Lenin further said during the period of the New Economic Policy (NEP) that: “It means that, to a certain extent, we are re-creating capitalism. We are doing this quite openly. It is state capitalism. - - - In a capitalist state, state capitalism means that is recognized by the state and controlled by it for the benefit of the bourgeoisie, and to the detriment of the proletariat. In the proletarian state, the same thing is done for the benefit of the working class, for the purpose of withstanding that as yet strong bourgeoisie, and of fighting it. It goes without saying that we must grant concession to the foreign bourgeoisie, to foreign capital. Without the slightest denationalization, we shall lease mines, forests and oil fields to foreign capitalists, and receive in exchange manufactures goods, machinery etc., and thus resort our own industry” (Lenin, Collected Works, Vol.32, p.491).

Post Reform Socialist China and Globalization

Today, the post reform socialist China is, a reflection of the theoretical positions Lenin had taken regarding state capitalism during the NEP period. The major challenge is: How the increasing productive forces in a backward economy to a level can sustain large-scale socialist construction?

In China today, what is being sought is to attain the conformity between the levels of productive forces and the socialist production relations cannot be sustainable at lower levels of productive forces. A prolonged period of low levels of productive forces would give rise to a major contradiction between the daily expanding material and cultural needs of the people under socialism and backward productive forces. The Chinese Communist Party (CPC) has concluded that if this contradiction remains unresolved, then socialism itself in China would be under threat.

Following the political turmoil that took place during the Cultural Revolution and after the dethroning of the ‘Gang of Four’ a serious introspection was begun by the CPC on political and economic issues. In 1978, clearly confusion and incorrect understanding on many political issues and practices, the CPC adopted a comprehensive ideological line that culminated in what they call ‘one central task and two basic points’. One central task is economic development; the two basic points are adherence to the four cardinal principles (Marxism-Leninism, Mao Zedong, socialist road; people’s democratic dictatorship; and leadership of the Communist Party) and the implementation of reforms and open door policy.

In order to achieve such a transformation, the CPC put forward another theoretical formulation that of building a socialist market economy. By now, it is clear that as long as commodity production exists, there would be a need for a market to exchange these commodities. So long as commodities are produced, the market forces and the market indicators will be able to efficiently develop the productive forces and meet the welfare demands of the people. Therefore, ignoring market indicators leads to greater irrational use of resources, which will adversely affect the plan process itself. CPC mentions that,

“First that public capital predominates in total social capital;

“Second, the state economy controls the economic lifeline and plays a dominant role in the national economy”.

Through this, they seek to prevent the economic polarization and growing inequalities created by private market economy and ensure the common prosperity of the working people. Today, the low level of poverty, good health, higher education, scientific research and technology development is possible in China because it developed on the solid foundations laid by the China during the first three decades of centralized planning.

Eritrea profile, Vol.14, No.29, 16 June 2007

Part-II

Challenges Ahead in China Economic Policy

However, new problems are also cropping up as a result of these developments such as growing inequalities, unemployment and corruption. While the state maintains a minimum subsistence allowance and offers re-training programmes for retrenched workers, unemployment is a serious problem. The government deals strictly with the corruption cases. “The disgraced head of China’s food and drug agency was sentenced to death yesterday amid a wave of consumer safety scandals. Zheng Xiaoyu, 62, was found guilty of accepting 6.5 m Yuan (£433,000) worth of bribes from pharmaceutical companies to expedite the approval of new drugs. Underscoring the State’s determination to crack down or corruption and consumer safety violations” (The Guardian, May 30, 2007:16). “Zheng was supposed to use the power given to him by the State and the people seriously and honestly, but instead he has ignored their vital interests by taking the bribes”, Xinhua quoted the court as saying.

The main challenge that emerges is whether these growing inequalities will take the form of the formation of an incipient capitalist class? Lenin, while talking to State capitalism and emphasizing the need to rapidly expand the productive forces, also warned of the risk to the socialist State that such a period of transitions will bring about. Characterizing the process of building state capitalism as a war, Lenin says, “the issue in the present war is – who will win, who will first take advantage of the situation: the capitalist, whom we are allowing to come in by the door, and even by several doors (and by many doors we are not aware of, and which open without us, and in spite of us) or proletarian State power?” (Lenin, Collected Works, Vol. 33, p.65). He proceeds further to state: “We must face this issue squarely – who will come out on top? Either the capitalists succeed in organizing first – in which case they will drive out the Communists and that will be the end of it or the proletarian state power, with the support of the peasantry, will prove capable of keeping a proper rein on those gentlemen, the capitalists, so as to direct capitalism along state channels and to create a capitalism that will be subordinate to the state and serve the state” (Lenin, Collected Works, Vol.33, p.66).

Similarly, Deng Xiaoping in a talk during his visit to southern China says: “The crux of the matter is whether the road is capitalist or socialist. The chief criterion for making that judgment should be whether it helps increase the overall strength of the socialist state and helps raises living standards” (Social Sciences in China, Vol. XX, No.2, p.29).

Further, in 1985, addressing some of the apprehensions of growing inequalities Deng Xiaoping says: “As to the requirement that there must be no polarization (read growing economic inequalities), we have given much thought to this question in the course of formulating and implementing our policies. If there is polarization, the reform will have been a failure. Is it possible that a new bourgeoisie will emerge? A handful of bourgeois elements may appear, but they will not form a class. Moreover, the contradiction between the increasing material & culture requirements of the people under socialism (already explained) needs to be taken seriously.

“In short, our reform requires that we keep public ownership predominant and guard against polarization. In the last four years we have been proceeding along these lines. That is, we have been keeping to socialism” (Selected works of Deng Xiaoping, Vol.3, pp.142-43).

Clearly, the CPC is in the midst of a serious effort of building socialism with Chinese characteristics. The CPC is endeavoring to rapidly expand the productive forces and, thus, consolidate and strengthen socialism in China through these reforms. On the other hand, as noted above, this very process engenders certain tendencies, which seek to weaken or even destroy socialism. As a result, ideas and values alien to socialism may also surface. Imperialist finance capital is there in China not to strengthen socialism but to earn profits and to create conditions of adversity to socialism. They would certainly seek the weakening of socialism or it’s dismantling in order to earn greater profits. This is the current struggle between imperialism and socialism that is taking place in the theatre of China.

China Economic Policy towards Africa

China now has diplomatic ties with 48 African countries. Africa played an important role in restoring the lawful seat of the China in the UN, foiling anti-China motions at the UN Human Rights Commission, support China’s reunification, supported China in its bid to host the 2008 Olympics and the 2010 World Expo. China-Africa have always treated each other with sincerity and as equals, pursued mutual benefit, solidarity, cooperation and common development. “The Chinese government predicts that total annual trade with Africa will reach $100 billion by 2010, a massive increase on the 2005 figure of $42 billion, which itself is 10 times bigger than bilateral trade in 1995. As recently as 1990, just 9% of African imports went to Asia; today, that proportion has tripled to 27%. According to World Bank, the value of African goods exported to Asia is rising by 18% a year, although most of this figure is accounted for oil exports (African Business, December 2006, No.326, UK). China President Hu Jinto commented: “Our meeting today will go down in history. China will forever be a good friend, good partner and good brother of Africa” (African Business: 39). CAP partnership is based on following principles and objectives such as:

1. Political Cooperation between China and Africa

China adheres to the Five Principles of Peaceful Coexistence, respects African countries independent choice of the road of development and supports Africa countries efforts to grow stronger through unity. China-Africa leadership facilitates communication, deepening friendship and promoting mutual understanding and trust. The high-level visits of China and Africa leadership to each other country pursue an environment of dialogue. This dialogue channels (Sincerity, friendship and equality) between the friendly political parties and through parliamentarians of the common countries. The mutual dialogue exchange their opinion on the basis of the principles of independence, equality, mutual respect and noninterference in each other’s internal affairs, which will develop mutual trust and cooperation. To strengthen it, the bilateral committees, political consultation, joint committee on trade and economic cooperation and science & technology will institutionalize dialogue and consultation in a flexible and pragmatic manner. China and Africa coordinate position on major issues concerning state sovereignty, territorial integrity, national dignity and human rights. China devotes to greater role of UN and establishing new international political and economic order. China-Africa emphasizes on bilateral exchanges and cooperation in local development.

Historically, China-Eritrea political relations emphasize right from the liberation movement. “In 1968 fighters who completed training in Syria and China returned to the field and began to mobilize for reforms. Among those, there were two young men, Isaias Afwerki and Ramadan Mohamed Nur, who were to have a lasting impact on the future of Eritrean politics. Isaias Afwerki returned from China to become the political Commissioner for Zone 5” (Poscia, Eritrea: Colonial Tradition: 98-99). The Zone 5 was the liberated unit working under ELF and later on EPLF. “The Eritrean peasantry was the backbone and main force of our national democratic revolution” (Vanguard 3 (6): 1978:14-21) and it was supported by China.

Similarly, the post-independent Eritrea had faced an attempt of invasion from Ethiopia and as a result, the Ethiopia Eritrea Boundary Commission formed (EEBC). The EEBC Declaration, 12th April 2002 and the war liability on Ethiopia is evidence and mentioned in the declaration. Not only that, Ambassador Shu Zhan of China said, “The Chinese government is actually very concerned about this issue. We believe that if this dispute is not resolved soon then it will continue to harm the peoples on both sides. We support and advocate that the EEBC’s ruling should be implemented as soon as possible so that the people on both sides can be relieved of their burden” (Eritrea Profile, vol.13, No.68, November 1st, 2006).

2. Economic Cooperation between China and Africa

Historically, Chinese vessels landed along the east coast of Africa during the medieval period. China built Tanzania-Zambia Railway during the cold war period of 1970s (African Business: 39). Deng Xioping said in 1982, “When a backward country is trying to build socialism, it is natural that during the long initial period its productive forces will not be up to the level of those in developed capitalist countries and that it will not be able to eliminate poverty completely. Accordingly, in building socialism we must do all we can, to develop the productive forces and gradually eliminate poverty, constantly raising the people’s living standards. Otherwise, how will socialism be able to triumph over capitalism? - - -A decision to this effect was made at the Third Plenary Session of the Eleventh Central Committee, (1978. Ed) and it represented an important turning point. Our practice since then has shown that this line is correct, as the whole country has taken on an entirely new look” (Selected Work of Deng Xiaoping, Vol.3, pp.21-22). Regarding China-Eritrea emerging economic relations, President Isaias Afwerki said during his interview with China Business Weekly magazine, “We have huge natural resources. In terms of minerals we are doing a lot of prosperity with companies coming from outside to do the prospecting in partnership with the government in this country. We still have a lot to explore in terms of mineral resources, which could be exploited. To exploit those resources we need to develop partnership”. Further he said that we are almost 90% shifting to China in the procurement of equipment and machinery. China has gone a long way in Hi-tech and telecommunications, the quality of the product and their prices have improved and this is an advantage. - --Talking about agriculture equipment we would like to introduce irrigated agriculture as a major form of agricultural productivity in the country (Eritrea Profile, Vol.14, No.7, 31 March 2007).

China supports African countries (Mutual benefit, reciprocity and common prosperity) endeavor for economic development and nation building, carriers out cooperation in various forms in the economic and social development and promotes common prosperity of China and Africa. China offers duty-free treatment from the least developed African countries; settle trade disputes through bilateral or multilateral consultations, mutual understanding and mutual accommodation. China government continues to provide preferential loan facility, explore new channels for promoting investment and agreement on avoidance of double taxation. The Chinese financial institutions will work with the regional financial institutions in Africa. China supports agriculture cooperation in land development, agriculture plantation, breeding technologies, food security, agricultural machinery and the processing of agricultural products. Along with it, the Chinese government will strengthen Africa infrastructure that includes transportation, communication, water conservancy, electricity and other. It supports competent Chinese enterprises to cooperate with African countries on the principle of mutual benefit and common development. Chinese Premier Wen Jiabao said, “China’s oil cooperation with several African countries is open, transparent, natural and mutually beneficial”. With in the framework of the Forum, China has canceled debt of 10.5 billion RMB Yuan (1.3 billion US$) incurred to 31 Heavily Indebted poor countries categories of import commodities from 29 least developed countries in Africa (Eritrea Profile, Vol.13, No. 58, 27 September 2006).

China encourages tourism, substantial actions on the issue of debt relief and reduction; increase financial assistance to African countries and to realize Millennium Development goals.

Eritrea past experience of war when Ethiopia attacked on Eritrea in 1998 was a real break to Eritrea political economy. This war damaged the ongoing self-reliance programmes of the country and derailed the economic development. Eritrea Human Development was engaged completely in the war that continued up to the year 2000. This war damaged Eritrea socio-economic development sector such as agriculture, education and dissemination of knowledge, affected health services, infrastructure, telecommunication and Eritrea arranged additional expenditure of millions of dollars to revive Eritrea self-reliant programme.

Eritrea profile, Vol.14, No.31, 23 June 2007

Part-III & Final

China-Eritrea Bilateral Relations

Today, regarding China-Eritrea relations, there is a pertinent question how does Eritrea advance towards socialism (Self-Reliance) in the era of globalization. It is Eritrea need to critically examine the sustainability of capitalist globalization experience of 20th century, socialism and future task accordingly. Eritrea economy is based on the self-reliance and the state is working accordingly. The self reliant economy right from the liberation struggle is Eritrea basic structure of economic development keeping the interests of Eritrea majority agrarian based population and here self-reliant does not need any explanation.

‘There is a need to understand what exactly the market means. Eritrea ancient civilization had markets (are the place) where goods that are produced get exchanged (is known as barter trade and it exists even today in Eritrea village markets). As long as there is commodity production there has to be a market where these goods go for exchange. So whether it is under feudalism, capitalism or self-reliant socialism, if commodities are produced, the market exists. It is not a market versus a non-market or state situation. It is a fact because market exists. The issue is recognizing the limitations of the market in terms of social objectives in Eritrea under self-reliance programme’ (Eritrea Profile, 31 March 2007). President Isaias said, “Through large scale irrigation farming, China has been able to cultivate a large portion of its land and ensure food security. Eritrea being a new nation needs to acquire a lot of experience from China. The business activities between the two nations are gaining ample momentum” (Eritrea Profile, Vol.13, No. 71, 11 November 2006).

Historically, China-Eritrea Relations started on the day of the founding of the State of Eritrea (May 24, 1993), the People’s Republic of China has established diplomatic relations with Eritrea, since then, the bilateral relations developed steadily and smoothly. President Isaias visited China in 1994, 1997, 2005 and 2006 and attended the Beijing Summit of the Forum on China-Africa cooperation. Since 1997, the Chinese government has dispatched 5 groups of total 85 doctors working in Eritrea. Ororta Hospital, which was completed in 2003, was constructed under the aid of China (Economic and Commercial Counselor’s Office, Asmara). The bilateral trade volume of 2006 is 39.95 million USD, which makes China (including Hong Kong and Taiwan region) the biggest trade partner of Eritrea (Eritrea Customs). Since August of 2006, two agreements were signed between the Exim Bank of China and the Government of Eritrea. According to that the bank shall lend concession loans, with a total amount of nearly 70 million USD to the letter. The loans will be used in the fields of telecommunication and cement factory (the interview given by the economic and commercial counselor, conducted by Reuters reporter on 17 April 2007).

Visit of China Officials in Eritrea

The high lever exchanges between the two countries are frequent. The Chinese officials who visited Eritrea are:

v Mr. Yang Wenchang, Deputy Foreign Minister attended the Independence Celebration of Eritrea as a special envoy of the Government of the People’s Republic of China, and signed the communiqué on the establishment of diplomatic relations in May 1993.

President Hu Jintao on the occasion of the China-Africa Cooperation said, “the Eritrean government has supported the Forum all along because it seeks to foster technological, trade, economic, cultural and political cooperation for the advancement of peace and sustainable development. The cooperation that we all have committed ourselves to undertake is sound because it is based on the principles of full equality, mutual respect and non-interference in each other’s internal affairs”. Further he said, “Eritrea believes that China and Africa can obtain significant mutual benefits from closer cooperation and partnership. The benefits derive from our shared values, similar needs, experiences and aspirations. We should seize the opportunity offered by this Forum to cooperate more effectively and realize our aspirations”.

Today, Infrastructure and mining deals worth a total of $1.9 billion were announced at the Summit, including $200m of investment in the Zambian copper sector, a $300m road upgrade scheme in Nigeria, plus a $300m investment in an Egyptian aluminum project. The $8billion contract awarded to China Civil Engineering Construction Corporation to build a 1315 Km railway from Lagos in the south to Kano in the north. The Chinese’s and Angola government encompassed an interest free loan to Angolan telecom sector in 2005 (African Business: 39). China and Eritrea bilateral relations emerge in the following sectors such as:

1. Mining Sector Development

President Isaias Afwerki said during his interview with China Business Weekly magazine, “Talking about mining, the Chinese have all the technology for mining and industries are taking advantage of these reiterates in China. For Eritrea, may be in the coming ten years much of the trade we do will be directly from China. After all markets are there. And the Chinese contribution in global market is becoming an opportunity for countries like Eritrea to take advantage. Not only procuring commodities, machinery and equipments but also exchange in terms of technology transfer, know how to transfer, working together with Chinese companies in a number of areas is an opportunity, which has not been there”.

“Much of the mining industry will depend on Eritrea partnership with China. If we get engaged in energy programs, mining, gold and other mineral extraction with Chinese companies, it is not the option but again it is also the opportunity comparative to what Africa has seen in the last 50 years or may be more than a century. It has been exploitation of resources by highly developed industrialized countries, without due respect to the developing countries”.

“If we can exploit again the natural resources effectively, we could be one of the wealthiest nations in the Horn of Africa. I believe that aspect of China-Eritrea relationship, China-Africa relationship will have a very significant impact for generations to come” (Eritrea Profile, Vol.14, No. 4, 21 March 2007).

Along with it, The government of China donated different electricity equipments to Eritrea worth over 600,000 dollars for backing up the nation’s ongoing efforts to distributing power lines in the rural areas (Eritrea Profile, Vol.13, No.48, 23 August 2006).

1. Education, Science, Culture, Health and Social Aspects

China will strengthen cooperation with Africa (Mutual support and close coordination) in the UN and other multilateral systems by supporting each other’s just demand and reasonable propositions and continue to appeal to the international community to give more attention to questions concerning peace and development in Africa. China will train African personnel as per the needs of African countries. China announces ‘African Human Resources Development Foundation’ to achieve this task (observed during my BBC interview on 4th November 2006). China will help African countries in Chinese language teaching and strengthen cooperation in vocational and educational distance learning. China-Africa shares common interest in bio-agriculture, solar energy utilization, geological survey, mining and research and development of new medicines as part of science & technology.

China and Africa encourages the idea of people to people exchange, cultural cooperation, water resource conservation, anti-desertification, bio-diversity humanitarian assistance and other. Mr. Tang Jiaxuan, State Councilor, said, “Culturally, China and Africa should be partners in advancing human civilization and building a harmonious world. We should promote tolerance, dialogue and equality among different civilizations so that they will draw on each other’s strength and enjoy common prosperity” (Eritrea Profile, Vol.13, No. 67, 28 October 2006).

“Eritrea and China concluded agreement towards upgrading the College of Arts and Social Sciences in Adi Keyih. The agreement is aimed at deploying Chinese experts in the study of the project so as to expand the college and make its programs effective” (Eritrea Profile, Vol.14, No.17, 5 may 2007).a) Agriculture

China is helping Africa out of poverty as a major goal of Sino-African cooperation. Farmers make up the largest population in China and Africa, and their escape of poverty is very important to the continuous development of both of them. Historically, China established agro-technical experiment stations in Guinea, Mali and Tanzania, growing rice, vegetables and sugar cane and promoting agro technologies (China Africa, vol.1, No.17, October 2006: 2). “The trade between China and Africa reached $50 billion in 2005. China has left a good impression with us over the last few decades, by lifting 300-400 million people put of poverty. This is unprecedented in history”, said by Khalid Malik, UN System Resident Coordinator and UNDP resident representative Interview with Beijing Review reporter, 16 October 2006).

“The highly complementary cooperative partnership between China and Africa is reflected by the surging and complementary trade and economic relations”. By the end of 2005, China had undertaken to find 800 projects in 49 African countries and Chinese companies had embarked on 58 projects with favorable loans to 26 African countries (China Africa, vol.1, No.17, October 2006: 4).

To facilitate the exportation of African goods into the Chinese market and help African countries to develop their economy, the Chinese government have granted zero-tariff treatment to 190 categories of goods from 28 least developed African countries (China Africa, vol.1, No.17, October 2006: 5). “Africa is a market with the most diversified consumption levels, with annual average trade value reaching $300billion. In 2005, the figure is expected to reach $480 billion (China Africa, vol.1, No.17, October 2006: 6). The same tempo is visualized as regards to China-Eritrea relations in the agriculture sector.

b) Medicine

“China establishes an anti-malaria center in each epidemic hit area. The end of 2007 will complete ten centers and another 29 will be built in the following two years. The Chinese government has specially allocated 300 million Yuan for the government-to-government project, and enterprises such as Holley-Cotec Pharmaceuticals Co. Ltd; would be supplying the medicine and providing training services. The huge demand for anti-malaria medicine in the African healthcare market has brought huge profits to this company, as it has been operating in Africa for more then 10 years. In 2005, its sales revenue in Africa reached 120 million Yuan. Its key product, Cotexin, covers 30 African countries, and severel million African people have recovered after taking the medicine (p:8). Further, Lu Chunming, general manager of this company stressed, “These people played a key role in our development in Africa. We are the poly Chinese pharmaceutical company that has established local branches and hired local employees.” Currently, Cotecxin (anti-malaria medicine) covers 30 African countries with its market share ranking first in East Africa and second in West Africa and several million African people have recovered after sale revenue in Africa and it will reach 1 billion Yuan (China Africa, January 2007, Vol. 2, No.1: 9) including Eritrea. Along with it, the Chinese medical doctors are working under “Volunteers Service” in Oroota Hospital and Sembel Hospital. c) Social Aspects

Cooking with solar energy is suited to locals in Africa. By doing this, they can greatly save on daily costs and protect their natural environment”. A United Nations report on Somalia by the Food Security Assessment Unit in early 2006 mentioned, “The trend pf massive and nearly irreversible degradation of rangelands through deforestation for Charcoal production is one of the major crisis there (China Africa, January 2007: 10).

Lindsay, owner of ‘butterfly’ style cooker’ in Somalia said, “One family would use about 100Kg of charcoal one month on average to cook, costing than about $25 a month. With solar cookers, the cost came to only about $5 a month. This company sells the China-made solar cooker at $150 a unit in Somalia, which compared to the average living standards, is a big amount for an ordinary family. Many Somali families cannot afford this even though they want to use solar comers to replace charcoal stoves” (China Africa, January 2007: 11). This solar cooker is an viable alternative as compare to gas cylinder for the Eritrean people, which will help in conserving Green Environment.

2. Peace and Security

China and Africa will learn from and draw upon (Learning from each other and seeking common development) each other’s experiences in governance and development, strengthen exchanges and cooperation in education, science, culture and health. Supporting African countries efforts to enhance capacity building, China will work together with Africa in the exploration of the roads of sustainable development. China continues to help train African military personnel and support defense and army building of African countries for their own security. China concerned to settle regional conflicts in Africa wither through AU or by UN. With regard to peace and reconciliation of the Horn of Africa region, President Isaias spoke during Beijing Summit on China-Africa Cooperation, 3-5 November 2006 that “China being a permanent member of the Security Council of the UN, has so far not played its due role. President Hu Jintao on his part applauded Eritrea’s efforts and said, “Development and prosperity can’t be ascertained without peace and reconciliation; hence China will work hard to achieve this” (Eritrea Profile, Vol.13, No. 71, 11 November 2006).

Conclusion

Overall, the Decree No. 16, 2004, Ministry of Commerce, China enacted on September 14, 2005 mentions under Article 6, “The business departments (Offices) of Chinese embassies (Consulates) shall attach importance to strengthening ties with Chinese-invested enterprises in their daily work, doing a good job in coordinative guidance services and shall facilitate the successful operations of Chinese-invested enterprises. For emergencies occurring in Chinese invested enterprises or the host country, the business departments (offices) shall endeavor to maintain undisturbed connections with the enterprises and notify the domestic departments in charge and domestic investment bodies of the current situation and shall make thorough arrangements and take handling measures to protect the various rights and interests of Chinese-invested enterprises and their employees. Mr. Abdoulaye Diop, Finance Minister of Senegal confirmed that Chinese funding would be very welcome in many poor countries” (African Business: 40). The Communist Party of China (CPC) develops exchanges of various forms with friendly political parties and organizations of African countries on the basis of the principles of independence, equality, mutual respect and non-interference in each other’s internal affairs.

Similarly, the Government of Eritrea announced new economic investment policy that is known as Proclamation No.159/2007 regarding Foreign Financed Special Investments (FFSI) Proclamation. It applies to all FFSI of more than Twenty Million US Dollars (20,000,000 USD) or its equivalent in other convertible currency. The features of this FFSI mentions under Article 4 as Objectives like:

“Without in any limiting the broad purposes of this Proclamation, this Proclamation has the following objectives:

1. to achieve self-sustaining economic growth and thereby to ensure steady improvement in the standard of living of the population of Eritrea.

2. to facilitate the rapid expansion of Eritrea’s potential and acceleration of social development;

The purpose of FFSI is to increase understanding and friendship and seek trust and cooperation between Eritrea and friendly countries. There are provisions under FFSI document to keep foreign investors enthusiasm and provide necessary facilities and information accordingly. This is an addition to the Free Trade Zone surrounding Massawa and the investors are encouraged to see other parts of the country, looking for the opportunities and invest consequently. This is the step forwarding the idea of today investment and tomorrow prosperity on the one hand and strengthening the mutual relations between the friendly countries on the other hand.